Hi Sadim,
Haven't heard from you since your last post which ended with a composition of verse. :-)
As to the place(s) where I usually skulk about, there are lots--and many invisible or off-angled from the SI perch. Stock-wise, I am also a frequent nocturnal visitor of the LU/RMBS threads, in addition to INTC. CSCO and MSFT.
LEAPS of 99 vintage are great for my temperament; the comfortable timeframe of 12-18 months before expiry allows me to treat the options as commons, meaning decision-making based on fundamentals without worrying about time-decay or institutional manipulations. So far I have had great success with all the ones I bought and sold, including 99 calls of various strike prices for the above 4 stocks in my core holdings.
Basically, these LEAPS calls are one of my main vehicles to partake in the volatile market. When there is a ST/IT low, I buy them and unload by (shorting against the box) when I feel a temporary top has been reached. The leverage factor is about 4 for the 99ers that I picked, and I like this vehicle a lot better than call-writing or puts, both of which are inherently limiting and rather unimaginative.
I found, also, that the best deal in LEAPS calls are associated with those stocks whose true volatility is low; thus the "volatility factor" in BS's equation is mostlt accounted for by the stock's growth. A case in point is LU: LEAPS calls (strike price 65) bought 3 months ago have returned 350% without giving anyone insomnia. Options for the intrinsically volatile stocks are priced much higher, and one needs to be on toes at all times lest the profits with evaporate right in front your eyes.
Regarding BB, I use them only in conjunction with RSI. Another short term indicator set I found useful are the directional movement indices DMI +/-. You might found this intriguing. Alphachart.com offers a simplistic (but adequate) version of it.
Regards,
Ibexx |
